Monday, January 23, 2017

No winding-up due to non-payment of professional fee which was disputed on ground of incomplete services


i. Petitioner-firm entered into a contract for providing architectural design services for construction of building.

ii. There were disputes for which the petitioner's services were not continuously engaged by the respondent-company. Further, petitioner had asked for his professional fee.

iii. Respondent - company had denied its liability to pay the professional fees on the ground that the petitioner firm had not given complete services. For repayment of its dues, petitioner had filed winding up petition against the company.

The High Court held as under:

a) It appears that the agreement between the parties about the providing of 'Professional Services' cannot be said to have a smooth sailing. Further, no final 'admitted liability' crystallized in favor of the petitioner - firm towards its professional services.

b) Winding-up petition couldn’t be exercised against a solvent company, if the liability of the respondent-company towards the 'Professional fees' was under bona fide dispute. - [2017] 77 32 (Karnataka)

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